Mr Barnett said the State Government had conditionally approved the Cape Lambert expansion project in advance of the board's Final Investment Decision.
"Investment on this scale in key port infrastructure is excellent news for the Pilbara and for Western Australia," he said.
"It underlines the increasingly significant role that expanded iron ore production and a dynamic Pilbara are having in shaping the economic and social future of our State."
The port construction workforce is expected to peak at more than 1,700 employees, with the finished facility adding about 100 full-time jobs to Rio's operational workforce.
"Construction workers will be accommodated on site, and Rio's more than $300million plan to expand the nearby Wickham township will provide housing for the operational workforce," the Premier said.
"The three-year project, and the expanded residential workforce, will create many additional opportunities, both in the Pilbara and across WA for businesses and employment.
"Resources investment projects like this will sustain the growth of regional communities, offering quality living and help realise the Liberal-National Government's Pilbara Cities vision.
"We do acknowledge projects like this put additional pressure on housing in the Pilbara and the Government is looking at ways of addressing this."
The Cape Lambert Port B project received environmental approval in 2010 and the Government approved the first phase of the project earlier this year.